Golden Rules: Lowering the Uneven Bars on Likelihood of Confusion

With the opening ceremony for the Rio 2016 Olympic Games less than 1 month away, Olympic sponsors and non-sponsors alike are thinking about how they may be able to capitalize on the event’s popularity. Brands must, however, beware of using Olympic trademarks (as discussed in our previous blog post, Golden Rules: Wrestling with the Use of Trademarks), in large part, because of the relative ease with which Olympic rights-holders, such as the United States Olympic Committee (USOC), can take legal action. In the United States, under the Ted Stevens Amateur Sports Act (Ted Stevens Act), the USOC has exclusive rights to use “Olympic,” “Olympiad,” the interlocking rings, event mottos and other Olympic trademarks. The Ted Stevens Act also prohibits use of any word, symbol, or combination thereof that “tends to cause confusion or mistake, to deceive, or to falsely suggest a connection with the user and the Olympics”. In practice, this is a very broad prohibition.

For example, the interlocking ring design is a trademark owned and controlled by the USOC. Unauthorized use of the image of the rings is not permitted on the basis of copyright defenses, such as the public domain or fair use, despite popular misconceptions to the contrary. The rings, and other Olympic trademarks, including the word “Olympics,” are also not generic. Use of the word “Olympics” can be protected by free speech in narrow circumstances, but if you are an advertiser reading this blog, it’s highly unlikely that you will be able to fit your uses into that “protected speech” category, even if you can credibly claim that your use is expressive.

Perhaps the biggest difference between Olympic trademarks and other trademarks is that, in order to protect Olympic trademarks, the USOC does not have to prove that a contested use is likely to cause consumer confusion. The congressional intent of creating and maintaining this exceptional legal regime around the Olympic trademarks is to provide the USOC with the exclusive right to monetize Olympic symbols to fulfill the USOC’s mission, including to fund Team USA. The United States government does not provide direct funding for its Olympic athletes, so Team USA’s ability to compete in each iteration of the Olympic Games depends, in large part, on the USOC’s ability to raise funds on its own. Dilution of the Olympic brand would mean less valuable marks. And less valuable marks could mean less financing for Team USA.

The Supreme Court confirmed in 1987 that a likelihood of confusion was not necessary in San Francisco Arts & Athletics Inc., v. United States Olympic Committee. In that case, the USOC prevailed against San Francisco Arts and Athletics Inc. (SFAA), which attempted to organize an event titled the “Gay Olympic Games.” SFAA claimed that its use of the word “Olympic” (a) did not violate the USOC’s trademark rights because it did not create a likelihood of confusion with the Olympic Games, and (b) was free speech, protected by the First Amendment, because its use was expressive insofar as it promoted gay rights and was not purely commercial. A majority of the Supreme Court rejected both of these arguments and granted the USOC an injunction against SFAA. The Supreme Court based its decision on both (i) the text of the Ted Stevens Act, which it interpreted to give the USOC an exclusive property interest in the Olympic trademarks without any requirement that the USOC show likelihood of confusion, and (ii) on the congressional intent that the USOC use the marks to raise money necessary to achieve its mission. Lower courts continue to follow the precedent set in San Francisco Arts & Athletics Inc., and to weigh congressional intent heavily in favor of insulating the USOC’s licensing abilities.

In addition to the extra protection available through the Ted Stevens Act, the USOC can pursue the remedies available under the Lanham Act to enforce its rights, including but not limited to seeking injunctions, monetary damages, defendant’s profits, and attorney fees.

If this all sounds harsh, that’s because the Congress intended it to be. Consider, for a moment, that an earlier version of the Ted Stevens Act, which was in force until 1978, made run-of-the-mill infringement of Olympic marks a crime, punishable by up to 1 year in prison! Although infringers of Olympic trademarks may no longer face criminal penalties, our message remains consistent: when going for the gold this summer — brands beware!

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